+
CERC Reaffirms Procedure for Recovering Legacy Dues in DSM Pool
ECONOMY & POLICY

CERC Reaffirms Procedure for Recovering Legacy Dues in DSM Pool

The Central Electricity Regulatory Commission (CERC) has reiterated that the approved methodology in the National Load Despatch Centre's (NLDC) detailed procedure applies to all deficits in the Deviation Settlement Mechanism (DSM) Pool Account, starting September 16, 2024.

It has directed distribution companies (DISCOMs) to ensure the timely payment of dues to avoid delays in compensating ancillary service providers and maintaining grid stability.

Notified in August 2024, the regulations outline a process for addressing deficits in the Deviation and Ancillary Service Pool Account (DSM Pool Account) under Regulation 9(7). Following the notification, the NLDC submitted a detailed procedure for recovering dues in two categories:

? Legacy dues: Dues accumulated before September 16, 2024. ? Current dues: Dues accrued on or after September 16, 2024.

CERC approved the procedure to facilitate efficient recovery of dues. However, NLDC reported that some DISCOMs had either not paid or had partially paid their dues. The DISCOMs raised concerns about the fairness of recovering legacy dues, arguing that the procedure did not explicitly mention provisions for such recovery.

The Commission emphasized that the DSM Pool Account is crucial for ensuring payments to ancillary service providers and maintaining grid security. Delays in payments could discourage service providers, potentially affecting grid operations.

CERC referred to its earlier Staff Paper on ‘Grid Security Charge,’ which highlighted the growing deficit in the DSM Pool Account due to high demand and insufficient reserves. The explanatory memorandum to the DSM Regulations also noted a ?4 billion (~$46.2 million) deficit as of March 2024, underscoring the need for a robust recovery framework.

Most available forecasting models provide predictions only in broader hourly intervals, which are insufficient for the precision demanded by the new rules. Additionally, these tools often fail to account for hyper-local weather conditions—especially critical for wind farms, where slight variations in wind speed across small distances can result in significant deviations from the forecasted output.

The Central Electricity Regulatory Commission (CERC) has reiterated that the approved methodology in the National Load Despatch Centre's (NLDC) detailed procedure applies to all deficits in the Deviation Settlement Mechanism (DSM) Pool Account, starting September 16, 2024. It has directed distribution companies (DISCOMs) to ensure the timely payment of dues to avoid delays in compensating ancillary service providers and maintaining grid stability. Notified in August 2024, the regulations outline a process for addressing deficits in the Deviation and Ancillary Service Pool Account (DSM Pool Account) under Regulation 9(7). Following the notification, the NLDC submitted a detailed procedure for recovering dues in two categories: ? Legacy dues: Dues accumulated before September 16, 2024. ? Current dues: Dues accrued on or after September 16, 2024. CERC approved the procedure to facilitate efficient recovery of dues. However, NLDC reported that some DISCOMs had either not paid or had partially paid their dues. The DISCOMs raised concerns about the fairness of recovering legacy dues, arguing that the procedure did not explicitly mention provisions for such recovery. The Commission emphasized that the DSM Pool Account is crucial for ensuring payments to ancillary service providers and maintaining grid security. Delays in payments could discourage service providers, potentially affecting grid operations. CERC referred to its earlier Staff Paper on ‘Grid Security Charge,’ which highlighted the growing deficit in the DSM Pool Account due to high demand and insufficient reserves. The explanatory memorandum to the DSM Regulations also noted a ?4 billion (~$46.2 million) deficit as of March 2024, underscoring the need for a robust recovery framework. Most available forecasting models provide predictions only in broader hourly intervals, which are insufficient for the precision demanded by the new rules. Additionally, these tools often fail to account for hyper-local weather conditions—especially critical for wind farms, where slight variations in wind speed across small distances can result in significant deviations from the forecasted output.

Next Story
Infrastructure Urban

Platinum Industries Q1 Revenue Rises 12 Per Cent

Platinum Industries Limited, a leading manufacturer of PVC and CPVC additives and the third-largest player in India’s PVC stabiliser market, has reported a 12.4 per cent year-on-year increase in revenue for the first quarter of FY26, supported by improved capacity utilisation and favourable market conditions.Revenue from operations rose to Rs 1.15 billion in Q1 FY26 from Rs 1.03 billion in the same quarter last year. On a sequential basis, revenue grew 19.6 per cent from Rs 965 million in Q4 FY25. EBITDA stood at Rs 152 million, down 26 per cent year-on-year from Rs 205 million, but more tha..

Next Story
Infrastructure Urban

Agarwal Industrial Q1 Profit Falls 67 Per Cent

Agarwal Industrial Corporation Limited (AICL), a leading manufacturer and trader of bitumen and allied products, has reported a sharp decline in earnings for the first quarter of FY26, with profit after tax falling 67 per cent year-on-year.For the quarter ended 30 June 2025, consolidated revenue stood at Rs 5.95 billion compared with Rs 7.09 billion in Q1 FY25, marking a 16 per cent decline. EBITDA dropped 39 per cent to Rs 380 million, while profit after tax fell to Rs 130 million from Rs 390 million a year earlier. Margins contracted, with EBITDA at 6.4 per cent against 8.7 per cent and net ..

Next Story
Infrastructure Urban

Vikas Ecotech Bags Rs 34 Million Order From Olectra

Vikas Ecotech Limited has secured a bulk order worth Rs 34.22 million from Olectra Greentech Limited, a leading player in India’s electric mobility and green energy sector. The order involves the supply of fire-retardant materials, specifically Aluminium Trihydrate (ATH).Execution of the order will be completed in the upcoming quarter, reinforcing Vikas Ecotech’s operational reliability and strong supply chain capabilities. The company said this order reflects growing confidence in its product performance, technical consistency, and commitment to delivering sustainable, safety-driven speci..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?